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AAPL · Forward model · iPad · Bear case

What has to happen in iPad

Model as of

This page changes iPad inside the complete AAPL model. Every other vertical, corporate programme and valuation assumption stays in the selected portfolio case.

AAPL forward model
Horizon
Consolidated fair value $217.85 all other verticals held in this portfolio case
Final-quarter revenue $4.47B 3% of company revenue
Explicit segment contribution $34.69B EBITDA less segment capex, before corporate items

The June quarter was the peak. Company growth halves from 16.4% to the guided 9-11%, gross margin steps back from 50.06% to 47-48% as the tariff refunds shrink from about two points to about one, supply constraints were guided to increase significantly sequentially across iPhone, Mac and iPad, and memory costs rise again. Services, the margin engine, already decelerated from 16.3% to 12.1% in a single quarter. R&D has grown at roughly twice the revenue rate for two consecutive quarters with no disclosed AI revenue, so corporate overhead drifts up rather than staying at 17.4%. What this case does NOT assume is a collapse in the installed base or the loss of the Google licensing payment - it says the fiscal 2026 growth rate was a tariff-and-cycle artefact that does not repeat.

iPad

Basis quarter$6.19B
Final quarter$4.47B
Implied CAGR−6%
Final revenue mix3%

$6,191M and the only category that shrank in the basis quarter, down 5.9% year over year in a quarter where every one of Apple's five geographic segments grew double digits. It was also named among the lines the September supply constraints will hit. No unit or price disclosure exists, so this is a growth driver on the reported line, carrying a derived seasonal index whose December factor is the clearest thing in its history.

Last four quarters
2025 Q3 $6.95B Reported
2025 Q4 $8.60B Reported
2026 Q1 $6.91B Reported
2026 Q2 $6.19B Reported
iPad hardware net sales
Sequential growth −3.5%/qtr decaying toward +0.3% Deseasonalised trend: the printed -5.9% year-over-year decline plus the named September supply constraint.
iPad

Latest: $4.47B (2031Q2E)

Period Value
2025Q1 $6.40B
2025Q2 $6.58B
2025Q3 $6.95B
2025Q4 $8.60B
2026Q1 $6.91B
2026Q2 $6.19B
2026Q3E $6.47B
2026Q4E $7.72B
2027Q1E $5.80B
2027Q2E $5.42B
2027Q3E $5.76B
2027Q4E $6.98B
2028Q1E $5.31B
2028Q2E $5.01B
2028Q3E $5.37B
2028Q4E $6.56B
2029Q1E $5.02B
2029Q2E $4.76B
2029Q3E $5.13B
2029Q4E $6.29B
2030Q1E $4.83B
2030Q2E $4.59B
2030Q3E $4.96B
2030Q4E $6.09B
2031Q1E $4.69B
2031Q2E $4.47B

Assumptions & reasoning

  • The six quarters are the disclosed iPad line from the Form 8-K 'Net sales by category' footnote; only the forward trend rate is ours.
  • Seasonality [Q1 0.931, Q2 0.894, Q3 0.973, Q4 1.203] is derived from this line's own printed history. Derived, not assumed: each of the two full four-quarter windows in the printed history (2025 Q1-2025 Q4 and 2025 Q3-2026 Q2) gives a factor of value over window mean, the two are averaged per calendar quarter and normalised to average 1.0. A shape is only asserted where the amplitude clears the disagreement between the two windows by at least 2x. iPad's amplitude is 0.309 against a maximum between-window disagreement of 0.068, a ratio of 4.6.
  • iPad was explicitly named among the categories affected by the September-quarter supply constraints, which the company guided to increase significantly sequentially. The -3.5% deseasonalised trend puts September at $6,503M, -6.5% year over year, close to the -5.9% the line just printed.
  • Margin and capex intensity are the uniform Products-level assumptions; Apple discloses neither a per-category gross margin nor a per-category capital expenditure figure.
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